Aviation to Thailand

Trends and opportunities

The market

The Asia-Pacific region is an important center for the commercial aviation industry, with annual passengers expected to reach 1.8 billion passengers by 2035. (Source: IATA forecast passenger demands ). Within this, Thailand is a major aviation hub due to its strategic location in the centre of ASEAN and its large and growing tourism industry.

Thailand has 54 civil and military airports, operated by different agencies and private companies.

There are six main airports in Thailand, which are operated by Airports of Thailand Public Company (AOT). The main international airport is Suvarnabhumi, followed by Don Mueang (a major low-cost international airline hub), and then the regional international airports of Chiang Mai, Chiang Rai, Phuket and Hat Yai. Together these serviced 790,354 flights (increased 8.60 per cent YOY), 121.7 million passengers (increased 10.83 per cent YOY) and 1.454 million tonnes freight and mail (increased 7.67 per cent YOY) in 2016. 67.31 per cent of international passengers travel through Suvarnabhumi, while 43.76 per cent of domestic passengers travelled through Don Mueang Airport.

Secondary commercial airports are operated by the Civil Aviation Authority of Thailand. Other airports are operated by private companies and government agencies including: The Royal Thai Air Force; The Royal Thai Navy; Department of Royal Rainmaking and Agricultural Aviation; The Royal Thai Army; the Electricity Generating Authority of Thailand; and Bangkok Airways. Some airports are jointly operated and used for military and civil purposes, for example Don Mueang International Airport and U-Tapao Airport.

AOT predicts passenger traffic through these airports to grow by 8 to 9 per cent in 2017, with foreign visitors expected to reach 35 million in 2017, up from 32.5 million in 2016, according to the Tourism Authority of Thailand.

This growth in demand for passenger and freight services from Thailand has resulted in significant pressure on the sector, which is driving demand across a broad range of aviation and aerospace products and services. This includes for training and education across practically all areas of the aviation workforce; plus maintenance, repair and overhaul (MRO) infrastructure and capability.

The Civil Aviation Authority of Thailand (CAAT), aviation companies, education institutes and airport operators are either conducting their own education programs or looking for reliable partners to improve safety and other standards for supporting Thailand’s aviation industry growth.

Aviation is one of five industries promoted under Thailand’s economic development plan, the Eastern Economic Corridor (EEC) which includes an Aerospace Industrial Estate Development Plan -or Aerospace Industry Cluster –to be developed around U Tapao – Pattaya International Airport, which has begun operation as Thailand’s new international airport serving the greater Bangkok region.

The Aerospace Industrial Estate Development Plan aims to develop the aerospace component industry, significantly expand maintenance repair and overhaul (MRO) centres, and develop new training centres at U-Tapao, which is located in the Royal Thai Naval Base, Sattahip (close to Pattaya) and where significant investments by major aviation component manufacturers and MRO centres will be located.

Aerospace Component Industry

The Aerospace Industry Cluster Project is supported by Thailand’s Board of Investment (BOI) which offers investment incentives. This has already attracted global aviation companies including Airbus, Rolls-Royce, Triumph Aviation Services, Chromalloy and Senior Aerospace to Thailand.

The aerospace component industry will focus on manufacturing components for airframe, engines and some other components. Top five aerospace components the BOI is promoting are 1) landing gear wheels, 2) auxiliary power units (APUs), 3) In-flight entertainment complex, 4) engine fuel and control, and 5) landing gears.

Maintenance Repair and Overhaul (MRO)

THAI Technical, the MRO division of Thai Airways International is leading the Thai government’s MRO Centre development project at U-Tapao Airport. Airbus has signed a memorandum of understanding (MOU) with Thai Airways to evaluate the development of a new regional maintenance and overhaul (MRO) facility. Airbus is looking to use the MRO centre at U-Tapao to support fast-growing demand for servicing low-cost carriers in the Asia-Pacific region.

Military Aviation - There are opportunities to provide MRO services and supply spare parts to smaller aircraft of the Royal Thai Military and other Thai government agencies. The majority of military aircraft in Thailand are aged and require full MRO and life-extending services.

Skills Development

There is growing demand for aviation training programs in Thailand.

There are currently 26 education institutes in Thailand offering aviation training programs and the Office of the Vocational Education Commission (OVEC) under the Ministry of Education has expanded its aircraft maintenance training centers from 2 to 6 locations in response to growing demand for aircraft maintenance technicians. Despite this increase in locations, Thailand only has capacity to train 180 technicians per year - still not enough to catch up with rising demand which is for around 500 technicians / year to meet the needs of the aircraft industry. OVEC has plans to open more aircraft maintenance training centres in provinces that have airports, but a shortage of qualified teachers in aerospace engineering is limiting further expansion.

Opportunities

Opportunities for Australian organisations and education providers include in:

• Airport management
• Airport safety
• Consultancy services (147 EASA requirement) including safety standards, technical skills, etc.
• Curriculum and training program development
• English for Aviation Industry courses
• Further aviation courses in specific areas such as avionics and other areas that Australia can offer
• Ground services
• Internships and student exchange programs
• MRO services up to A Check
• MRO services and spare parts supplies for military and government owned aircraft
• Safety training in accordance with ICAO’s and EASA’s standards
• Technical and knowledge training program for instructors/teachers

Regulations

Three main regulators of the Thai aviation industry are:

1. Civil Aviation Authority of Thailand (CAAT)

CAAT is an independent agency of the Thai government responsible for prescribing, regulating, safety licensing and auditing of the Thai civil aviation industry endorsed by ICAO.

Aviation companies and individuals who wish to work in the Thai aviation industry must be certified by CAAT. Other aviation safety licenses such as European Aviation Safety Agency (EASA), Federal Aviation Administration (FAA) or Civil Aviation Safety Authority (CASA) can be converted to a CAAT license but additional examination is required.

Its role and responsibilities also include: implementing the Air Navigation Act; promoting and developing national civil aviation; executing orderly civil aviation; making airports available to the public; and coordinating and cooperating with domestic and international organisations.

2. Aeronautical Radio of Thailand (AEROTHAI)

Aeronautical Radio of Thailand Ltd (Aerothai) is a Government Enterprise under the Ministry of Transport and Communications which provides air traffic control and aeronautical communication services for airline operations.

Key Roles and Responsibilities of AEROTHAI include:

• Air traffic management (ATM) within the Bangkok Flight Information Region (Bangkok FIR) for the safety and efficiency of flights of Thailand’s airspace
• Communications, navigation and surveillance (CNS) systems and services
• Aeronautical information services (AIS) and aeronautical charts

3. Civil Aviation Training Centre (CATC)

CATC is a division within the Department of Aviation, Ministry of Transport responsible for producing and developing personnel for the Thai aviation industry. CATC is ICAO’s approved training organisation, provides training programs in aircraft maintenance, aircraft services and other aviation-related services.

CATC’s roles also include providing support to the operations of the Civil Aviation Authority of Thailand in accordance with the government policy that complied with ICAO Annexes to the Convention on International Civil Aviation, and providing assessment and approval of applications for personnel licenses as designated.

Competitive environment

Airline operators normally have contracts with aircraft manufacturers for air frame and aircraft engine repairs. Only recurring maintenance and regular checks are done by air carriers or their sub-contractors. However, there are still windows of opportunities for Australian companies to supply spare parts and provide MRO services to military and government aircraft, and to indirectly provide other services in the market through OEM manufacturers such as Boeing and Airbus. The use of local agents is a common feature of sourcing by military and government agencies in Thailand.

Thai aviation industry is more familiar with EASA and FAA licenses than CASA due to originated countries of aircraft and engine manufacturers, and flying destinations. To market Australian aviation products, services and training programs into Thailand, EASA or FAA licenses would be an advantage and is in many cases, essential.

Market entry

Accessing opportunities in the Thai aviation industry, following options should be considered:

• Establish relationships with aircraft and aircraft engine manufacturers such as Airbus, Boeing, Rolls-Royce, Pratt and Whitney, etc. for becoming their suppliers
• Develop partnerships with local MRO centres
• Appoint a local sole agent/distributor who are existing suppliers of airlines, aviation companies and defence forces
• Collaborate with aviation training organisations and education institutions in Thailand

Links and industry contacts

Government, business and trade

Aeronautical Radio of Thailand Limited
Airports of Thailand Public Company 
Australian Embassy Bangkok 
Australian-Thai Chamber of Commerce
Civil Aviation Authority of Thailand 
Civil Aviation Training Center of Thailand 
Ministry of Commerce
Ministry of Education 
Ministry of Transport 
Ministry of Foreign Affairs 
Office of the Board of Investment 
Royal Thai Customs Department
Royal Thai Air Force
Stock Exchange of Thailand
Thai Airways International 
Thai Chamber of Commerce 
Tourism Authority of Thailand

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